Consumer Behavior Final
lexicographic rule
(non-compensatory) select the brand that is the best on the most important attribute (i.e. hotel w/ best ocean view)
How and why do groups influence our behavior? (Referent, Information, Expert, Legitimate, Reward, Coercive)
*Referent: If a person admires the qualities of a person or a group, he tries to copy the referent's behaviors (e.g., choice of clothing, cars, leisure activities) Prominent people for ... (1)Product endorsements Eg: Lady Gaga for Polaroid (2)Distinctive fashion statements Eg: Kim Kardashian's displays of high-end designer clothing (3)Championing causes Eg: Brad Pitt for UNICEF Referent power is important to many marketing strategies because consumers voluntarily modify what they do and buy to identify with a referent. *Information: A person possesses information power simply because he or she knows something others would like to know -People with information power → influence consumer opinion by virtue of their access to the knowledge that provides some kind of competitive advantage *Expert: Knowledge an individual possesses about a content area Eg: Professional critics' reviews of restaurants, books, movies, and cars Sidenote: Nowadays with blogs and open source references, such as Wikipedia, it's getting harder to tell just who is really an expert *Legitimate: We grant power by virtue of social agreements, such as the authority Eg: Police officers, soldiers, and yes, even professors We can see legitimate power exemplified in uniform Eg: A medical student that wears a white coat in the hospital brings a sense of comfort to the patients/visitors of the hospital because the uniform suggest they are experienced/fully educated *Reward: A person or group with the means to provide positive reinforcement Tangible: Contestants on Survivor experience when their comrades vote them off the island Intangible: feedback the judges on The Voice → contestants *Coercive: When we influence someone because of social or physical intimidation Eg: A bully Eg in marketing terms: When salespeople try to do a "hard sell" (aggressive advertising)
How does income affect consumer behavior?
-A consumer with a high income, most likely has a greater discretionary income -Discretionary income: money available to a household over and above what it requires to have a comfortable standard of living -Money leftover after paying all the bills
What are the situational factors having an impact on purchase? (Consumption context, Mood, Time Orientation, Shopping Orientation) Practice Q: A person's ___ is an important factor in his antecedent state before putting himself into a purchasing environment. A) shopping orientation B) consumer satisfaction C) exposure to point-of-purchase stimuli D) reflective potential
.A) shopping orientation
What is a subculture?
A group whose members share significant beliefs and common preferences Example: gender, race/ethnicity, religion, age, and where we live
Knowledge function
A knowledge function applies when a person is in an ambiguous situation ("it's OK to wear casual pants to work, but only on Friday") or when s/he confronts a new products.
What is the process of assimilation?
Individuals adopt products, habits, and values they identify with the mainstream culture Eg: Many immigrants undergo this when moving to a foreign environment
How is opinion leadership different from Market Maven and Consumer Surrogate?
Market maven: person who likes to transmit marketplace information of all types. Surrogate consumer: often guides what we buy. Market maven and surrogate consumers are subforms
Describe the ( 5 ) steps in the decision making process?
Step 1: Problem Recognition when we experience a significan on t difference between our current state of affairs and some state we desire. Step 2: Information Search is the process by which we survey the environment for appropriate data to make a reasonable decision. Step 3: Evaluation of alternatives we call the alternatives a consumer knows about the evoked set and the ones he or she seriously considers the consideration set Step 4: Product choice we assemble and evaluate the relevant options in a category, eventually we have to choose one. Step 5: PostPurchase evaluation when product or service we selected and decide whether it meets/ exceeds our expectations
Hierarchy of effects; explain the relative impact and which of the three components comes first. (Knowing, feeling, or doing)
Each hierarchy specifies that a fixed sequence of steps occur en route to an attitude. High-involvement hierarchy: Think ---Feel ---Do assumes that a person approaches a product decision as a problem-solving process Low-involvement hierarchy: Think ---Do ---Feel In this form, the consumer does not initially have a strong preference for one brand over another, but instead acts on the basis of limited knowledge and then forms an evaluation only after the product has been purchased or used. Experiential hierarchy: Feel -- Do ---think this perspective highlights the idea that attitudes can be strongly influenced by intangible product attributes (such as packaging
What is social identity theory?
Each of us has several "selves" that relate to groups We think of ourselves not just as "I," but also as "we" We favor others that we feel share the same identity Even if that identity is superficial and virtually meaningless
T or F: Balance theory helps explain why consumers like being linked to positively valued objects.
FALSE
T or F: The psychological principle of reciprocity is at work when we take into account what others do before we decide what to do.
FALSE
Why do we have attitudes?
We form some attitudes because we need order, structure, or meaning.
Principle of cognitive consistency
We value harmony among our thoughts, feelings, and behaviors, and a need to maintain uniformity among these elements motivates us.
Permission marketing
When consumers opt-in to receive information from an organization they are more likely to pay attention to it when a message arrives.
Hierarchies of Effects
a fixed sequence of steps that occurs during attitude formation; this sequence varies depending on such factors as the consumer's level of involvement with the attitude object
compensatory model
a rational decision-making model in which choices are systematically evaluated on various criteria
non-compensatory model
a simple decision model in which negative information leads to rejection of the option
Does attitude predict behavior? Describe the Theory of Reasoned Action.
-A person's attitude doesn't predict behavior. -Many studies report a low correlation between a person's reported attitude toward something and actual behavior toward it. E,g, ("do as I say, not as I do") -Theory of Reasoned Action is a newer version of the Fishbein Model -Fishbein model is the most influential Multi Attribute Model that measures ( 3 ) components of attitude that help determine a consumer's overall attitude towards an object 1. Salient beliefs 2. Object-attribute linkages 3. Evaluation -This newer model tries to measure attitude toward the act of buying (Aact), rather than only the attitude toward the product itself.
What is acculturation and de-ethnicization
-Acculturation -Process of movement and adaptation to one country's cultural environment by a person from another country Eg: Immigrants who reside in America have to abandon their familiar settings and learn a new language De-ethnicization Occurs when a product we link to a specific ethnic group detaches itself from its roots and appeals to other groups as well Eg: Italians brought pizza to America but we don't eat pizza thinking of Italy as strong as, perhaps, when eating pasta
What is consumer confidence?
-Consumers' beliefs about what the future holds -Reflects how optimistic or pessimistic people are about the future health of the economy -Important because consumer confidence influences how people will spend when using discretionary purchases
\What are the considerations in elements of communication when attempting to persuade? (Route to Persuasion - Elaboration Likelihood Model)?
-Route to PersuasionCentral route to persuasion occurs when a person is persuaded by the content of the message. Peripheral route to persuasion occurs when a person is persuaded by something other than the message's content -The Elaboration Likelihood Model (ELM) Assumes that, under conditions of high involvement, we take the central route to persuasion. Under conditions of low involvement, we take a peripheral route instead. In contrary , when we find the information in a persuasive message relevant or interesting, we pay careful attention to it. In this event, we focus on the arguments the marketer presents and generate cognitive responses to this content
On what basis can you segment consumers into social classes?
-Slightly different mannerisms, aesthetic tastes, appearance, and dress sense -Blue-collar workers with relatively high- prestige jobs still tend to view themselves as working class, even though their income levels are equivalent to those of many white-collar workers -These people tend to socialize with one another and share many ideas and values regarding the way life should be lived.
How is social class different from income?
-Social class is a better predictor of purchases that have symbolic aspects but low to moderate prices (e.g., cosmetics, liquor). -Income is a better predictor of major expenditures that do not have status or symbolic aspects (e.g., major appliances). -We need both social class and income data to predict purchases of expensive, symbolic products (e.g., cars, homes).
How does social media relate to digital word of mouth? (Managing it, Measuring it, Using it)
-Social media drives the spread of word-of-mouth. -People have always discussed the experiences they have had with brands, services, and products. These discussions are now being held via social media, further contributing to WOM, as social media has a higher, faster and real-time reach when compared to traditional, offline WOM.
Why is it difficult to identify consumers in terms of their ethnic subculture membership?
-The rapidly growing diversity of U.S. culture is one of the most important drivers of change in this century. The U.S. Census Bureau projects that by 2018, it won't be possible to place a majority of children younger than the age of 18 into a single racial or ethnic group. -Our country truly is a "melting pot" of people who belong to many different racial and ethnic subcultures. -It is difficult because there are two types of context culture: High-context culture: group members tend to be tightly knit, and they infer meanings that go beyond the spoken word Symbols & gestures > words, carry much of the weight of the message Low-context: people who are more literal
Describe the Multi-attribute Model of Attitudes.
-This type of model assumes that consumers' attitudes toward an attitude object (Ao) depends on the beliefs they have about several of its attributes. This model contains three specific elements. -Attributes are characteristics of the attitude object. ∙ -Beliefs are cognitions about the specific attitude object. A belief measure assesses the extent to which the consumer perceives that a brand has a particular attribute -Importance weights reflect the relative priority of an attribute to the consumer. Some attributes are more important than others to the consumer. These weights are likely to differ across consumers -Note// Attitude models specify the different elements that might work together to influence people's evaluations of attitude objects
Balance theory
-a theory holding that people try to maintain balance among their beliefs, cognitions, and sentiments -considers how people perceive relations among different attitude objects, and how they alter their attitudes so that these remain consistent (or "balanced").
What are the factors that are important to building a brand community
1. Social Networking -Welcoming -Empathizing -Governing 2. Community Engagement -Documenting -Badging -Milestoning -Staking 3. Impression Management -Evangelizing -Justifying 4. Brand USe -Customizing -Grooming -Commoditizing
How can you segment high income consumers?
1.Luxury is functional "Quality of quantity" Consumers purchase $$$ items for its long-lasting term and endurance Tend to act on logic over emotions and impulses 2. Luxury is reward "I've made it" Younger age group than "Luxury is functional" Purchase with the desire to be successful or demonstrate their success 3. Luxury is indulgence "Treat yourself" Youngest age group and smallest group out of the three Extremely lavish and self-indulgent Emotional and impulsive > other two groups
Value-expressive function
A person forms a product attitude in this case because of what the product says about him or her as a person. Note// Value-expressive attitudes relate to how consumers cultivate a cluster of activities, interests, and opinions to express a particular social identity.
Self-regulation
A person's efforts to change or maintain his or her actions over time
Despite improvements to the Fishbein model, all of the following are considered obstacles to predicting behavior using this model EXCEPT which one? A) The model has relatively weak theorems about attitudes B) The model deals with actual behavior, not with the outcomes of behavior. C) Some behavioral outcomes are beyond the consumer's control D) Measures of attitude often do not correspond to the behavior they are supposed to predict
A) The model has relatively weak theorems about attitudes
Why do attitudes Exist
According to Daniel Katz, functional theory of attitudes to explain how attitudes facilitate social behavior.-----(Attitudes exist because they serve some function for the individual; that is, they are determined by a person's motives.)
Which are the biggest ethnicity based subcultures and what are their characteristics?
African Americans (p. 461-462) Poorly depicted in media Value skin color Beauty, strength, roots Confident Hispanic Americans (p. 462-463) Geographically concentrated Easier for marketers to reach them Many Backgrounds 60 percent = Mexican descent Just fewer than 10% = Puerto Ricans ~30% = Central Americans, Dominicans, South Americans, & Cubans Live in suburbs Large families (including grandparents) Community-based Asian Americans (p. 463-464) Fastest-growing population Well-educated 20 ethnic groups Emphasis on family
Sleeper effect
After a while, people appear to "forget" about the negative source and change their attitudes anyway.
Describe subcultures based on age cohorts and family.
Age Cohort: consists of people of similar ages who have similar experiences Many common memories about cultural icons John Wayne vs Brad Pitt Important historical events Great Depression vs Great Recession Family Fertility rates are decreasing Needs rate to be 2.0 (kids to replace their parents) Sweden, Germany, Greece = 1.4/- U.S. = 2.1 Extended family: grandparents, aunts, uncles, and cousins Nuclear family: mom, dad, and 1/+ child (maybe a dog too)
What is an attitude? What are its components?
Attitude is a lasting, general evaluation of people (including oneself), objects, advertisements, or issues. We call anything toward which one has an attitude an attitude object Note// an attitude is lasting because it tends to endure over time
Ego-defensive function
Attitudes we form to protect ourselves either from external threats or internal feelings E.g. Women not buying instant coffee because it will threaten their perception of being "capable homemakers"
What are the three different types of decisions?
Cognitive, Habitual, Affective
What are the six major psychological principles that can influence people to change their minds or comply with a request?
CCARLS 1. Consistency-- people try not to contradict themselves in terms of what they say and do about an issue 2. Consensus --We consider what others do before we decide what to do 3. Authority--we believe in an authoritative source) 4. Reciprocity-- we are more likely to give if first we receive 5. Liking -- we agree with those we like or admire 6. Scarcity --when something isn't available or limited
ABC model
Describes three major components of attitudes Affective component- person's feelings about the thing Behavioral component- The influence that attitudes have on behavior Cognitive component- Beliefs/knowledge about a specific object of interests
What is an opinion leader and how do you identify one (general characteristics)?
People who are knowledgeable about products and whose advice others take seriously Frequently able to influence others' attitudes or behaviors Valuable information sources because they possess the social power: Technically competent, so they possess expert power They prescreen, evaluate, and synthesize product information in an unbiased way, so they possess knowledge power Socially active & highly interconnected in their communities Likely to hold offices in community groups and clubs and to be active outside of the home = opinion leaders often wield legitimate power by virtue of their social standing. Similar to the consumer in terms of their values and beliefs, so they possess referent power Although opinion leaders are set apart by their interest or expertise in a product category, they are more convincing to the extent that they are homophilous rather than heterophilous. Homophily → degree to which a pair of individuals is similar in terms of education, social status, and beliefs. Effective opinion leaders tend to be slightly higher in terms of status and edu- cational attainment than those they influence, but not so high as to be in a different social class. Often among the first to buy new products, so they absorb much of the risk This experience reduces uncertainty for the rest of us who are not as courageous The hands-on experience of opinion leaders makes them more likely to impart both positive and negative information about product performance → Thus, they are more credible because they have no "axe to grind."
What is Persuasion and what are the factors that help in persuasion?
Persuasion involves an active attempt to change attitudes (factors below)
habitual decision making
Priming, Nudging, Framing -Loss Aversion, Heuristics a purchase decision process in which consumers engage with little conscious effort
What is word of mouth and what is its impact?
Product information that individuals transmit to other individuals
Guerrilla marketing
Promotional strategies that use unconventional means and ven- ues to encourage word of mouth about products
Utilitarian function
Relates to the basic principle of reward and punishment.We develope some attitudes toward products because they provide pleasure or pain. E.g. If a person likes the taste of a cheeseburger, that person will develop a positive attitude toward cheeseburgers
T or F: According to the Fishbein model, salient beliefs are those beliefs about an object that are considered during evaluation
TRUE
T or F: Latitudes of acceptance and rejection are important aspects of social judgment theory
TRUE
Does social class predict consumer behavior?
The answer partly depends on the type of product: Do people buy it largely for its functional value (what it does), or for its symbolic value (the impression it conveys to others)? ● Social class is a better predictor of purchases that have symbolic aspects but low to moderate prices (e.g., cosmetics, liquor).
What is the bottom of the pyramid and how can a marketer approach it?
The bottom of the pyramid are low income consumers Approach: Sell a product/service at an affordable price
Describe the different time dimensions and how it relates to different segments of consumers?
The researchers identified four dimensions of time: (1) the social dimension refers to individuals' categorization of time as either "time for me" or "time with/for others"; (2) the temporal orientation dimension depicts the relative significance individuals attach to past, present, or future; (3) the planning orientation dimension alludes to different time management styles varying on a continuum from analytic to spontane- ous; and (4) the polychronic orientation dimension distinguishes between people who prefer to do one thing at a time from those who have multitasking timestyles.
Long Tail
This aspect of online customer review is one important factor that's fueling an important business model.
Native advertising
This term refers to digital messages designed to blend into the editorial content of the publications in which they appear
Consumer hyperchoice
forces us to make repeated decisions that may drain psychological energy while decreasing our abilities to make smart choices.
Elimination by aspects
gradually eliminate options whose attributes fail to satisfy a minimum criteria (i.e. maximize positive - start with those that have ocean view - partial and full)
Rational perspective
people integrate as much information about a product, weigh the pluses and minuses of each alternative, and arrive at a satisfactory decision
Comparative advertising
refers to a message that compares two or more recognizable brands and weighs them in terms of one or more specific attributes.
Shared endorsements
users who follow or rate a product or service may find that their endorsements show up on the advertiser's page
Halo effect
which occurs when we assume that persons who rank high on one dimension excel on others as well.
